ASEAN’s digital path to prosperity

By Jirayut (Topp) Srupsrisopa, founder and Group CEO of Bitkub Capital Group Holdings

The fast growth of Thailand’s digital economy points the way to a more economically integrated and inclusive region, writes Jirayut (Topp) Srupsrisopa.

The Fourth Industrial Revolution is fundamentally transforming the global economy and society through the integration of digital technologies. ASEAN members states, with their diverse economic structures and varying levels of digital readiness, are poised to embrace a digital pathway to ‘developed country’ status.

Developed by the ASEAN Secretariat in collaboration with the ASEAN ICT Ministers Meeting (AIMM), the ASEAN Digital Master Plan (ADM), launched in 2021, outlines a set of initiatives and targets for achieving ASEAN's aspirations for a “digital economy and digital society” by 2025. These include enhancing digital infrastructure, promoting digital skills development, and encouraging digital innovation and entrepreneurship. Investment in digital infrastructures is a pre-condition for ensuring citizens have the tools and knowledge necessary to participate in the digital economy. A strong culture of data-driven decision making has been growing across the region. Thus, enhanced connectivity through infrastructure development and digitalisation will bridge the digital divide.

As the Group CEO of Bitkub, a digital asset group of companies in Thailand, I aim to seize on the burgeoning digital economy, but the potential can only be realised if there is sufficient digital infrastructure in place.

The World Bank has highlighted the Herculean effort required for states to graduate from one income bracket to another. Given that Thailand achieved upper-middle income status in 2011, we need to think about its potential for further growth as it aims for high-income status by 2027.

How much growth can the Thai economy generate? We think a realistic estimate, on a sustained basis, is around 3% per annum, although it could go higher. For that, you need to implement pro-growth policies. You need to think about how you increase investment and how you can find ways to push the technological frontier, turning the economy on to more digital opportunities.  Leveraging digital economy infrastructure will be a vital to Thailand’s aspiration for high-income status.

The digital economy in Thailand has experienced significant growth in recent years. Between 2017 and 2019, the digital economy's contribution to GDP increased by 15%, reaching 17.3% in 2019. This growth is expected to continue, with the digital economy projected to account for 30% of Thailand's GDP by 2030. It also had an impact on careers, with the Information and Communication Technology sector alone generating over 4 million jobs in 2019.

The strong rate of growth of the digital economy in Thailand and the contribution it has made to GDP serves as an instructive model for the ASEAN bloc, showcasing how strategic investments in digital technologies can catalyse economic growth and modernisation. The insights gleaned from Thailand's digital journey are relevant to the broader economic challenges and priorities within ASEAN.

The embrace of digital technology can play a major role in alleviating the region’s many economic and social challenges and advancing the goal of economic integration. There are wide disparities in income and wealth levels among its member states. This disparity can hinder ASEAN's overall economic progress and exacerbate social tensions within the region. ASEAN member states should prioritise inclusive growth and promote labour mobility to ensure that its citizens have access to quality jobs and economic opportunities.

While ASEAN has made significant strides in promoting regional integration, there are still numerous barriers to the free movement of goods, services, capital, and labour within the region. ASEAN should enhance its regional economic integration efforts by accelerating the implementation of the ASEAN Economic Community Blueprint 2025. This includes promoting the adoption of common regulatory frameworks, harmonising technical standards, and reducing non-tariff barriers. The adoption of digital technologies will help facilitate cross-border trade and investment.

Not all economic challenges can be seen through the lens of digital economy. However, there are a range of supportive policies the bloc can embrace that benefit all sectors, in which digital technologies can act as enablers.

Trade tensions between major economies can disrupt global supply chains and limit market access for ASEAN member states, while protectionist policies can hinder foreign investment and limit economic opportunities. Strengthened ties with global trade partners through free trade agreements and regional comprehensive economic partnerships can serve as a defence against protectionist pressures. ASEAN should continue to advocate for free trade and work towards developing new trade agreements with non-member countries. Simplifying trade regulations, standardising customs procedures, and promoting transparent legal frameworks across ASEAN will be instrumental in attracting foreign direct investment and boosting intra-regional trade.

Lastly, environmental sustainability. ASEAN should promote the adoption of sustainable land-use practices and invest in natural capital to ensure the long-term sustainability of its natural resources. ASEAN must focus on creating regulatory frameworks that incentivise the adoption of green practices and technologies. Collaborative efforts in combating climate change, managing natural disasters, and preserving biodiversity are essential for a sustainable ASEAN economic landscape.

Jirayut (Topp) Srupsrisopa is the founder and Group CEO of Bitkub Capital Group Holdings - the largest blockchain and digital asset group of companies in Thailand.

This article is part of a series of op-eds published in conjunction with the Emerging Leaders' Dialogue of the ASEAN-Australia Special Summit convened in Melbourne between 4 and 6 March in a partnership between the Australian Government and Asialink. The full collection of op-eds can be found here.